The other day, a friend said to me, “The economy is coming back but most businesses still aren’t going to invest in soft skills like cross-cultural training and coaching. There’s not much market for that.”
Full disclosure: I lead an organisation devoted to the assessment and development of cultural intelligence so I own my biases here. And I admit that training budgets are still tight for many companies. But the idea that intercultural capabilities are simply intangible, soft skills is a misnomer.
Research demonstrates that higher levels of cultural intelligence (CQ)—a globally recognized way of measuring and improving cross-cultural effectiveness—results in:
• Improved Cross-Cultural Effectiveness
Prior to the evidence gathered from the cultural intelligence research, it was difficult to prove that “cultural sensitivity” or having a “global mindset” actually led to a change in performance. But dozens of studies conducted by academic scholars across more than 30 countries have consistently found that individuals and organisations with high levels of CQ more effectively fulfill their objectives in cross-border contexts than individuals and companies with lower levels of CQ.
• Job Performance
The research on cultural intelligence also demonstrates that employees with higher levels of CQ are better able to meet the challenges of serving a diverse customer base at home and abroad and they do better effectively working with diverse colleagues. More specifically, the higher the CQ, the better the employees were at negotiating, networking, innovating, and leading multicultural teams.
• Personal Well Being
Individuals with higher levels of CQ are less likely to experience fatigue, stress and burn out from the constant demands of working in multicultural situations. Higher levels of CQ both enhance an employee’s own personal well being while simultaneously making them more productive and engaged in their work.
• Efficiency and Profitability
In light of these other findings, it’s no surprise that individuals and organisations that more successfully adjust cross-culturally, do their jobs better, and have a better level of personal well being, save and earn more money. One study found that 92 percent of 100 companies that assessed and developed cultural intelligence saw an increase in their profit margins. All the companies credited the attention upon CQ as a significant correlating factor to increased revenues, cost-savings and efficiencies.
Meanwhile, a recent study found that 85% of U.S. companies doing business in China are losing money. That calls for something more than a fluffy day of cross-cultural training for everybody in the company. A much more sustained, strategic approach is needed.
I actually place the primary responsibility for intercultural training being perceived as a “fluffy, touchy-feely” topic upon those of us who research, write, and talk about the topic. I talk to countless individuals who tell me how they endured the diversity training that was forced upon them so their companies could demonstrate compliance to anti-discrimination laws. And I hear from just as many who say the training they went through before working in another country had little relevance to the work they actually did there.
One guy said, “They spent an hour telling me why I should never touch a Thai person on the head before I went to Bangkok. Meanwhile I’m thinking, Um…I never touch any professional colleague on the head! This is a waste of time!”
I don’t think that all these training programs are flawed. Calling people to respect each other and teaching employees to learn the practices of various cultures is important. But we have to do a better job of making the business case for why assessing and developing intercultural effectiveness is a bottom-line issue. The case can easily be made through the empirical research that led to the findings above. And the daily news and frequent conversations will provide countless anecdotes of the money lost when companies attempt to do “business as usual” when working across borders—at home and abroad.
The globalized world offers a sea of opportunities and challenges. Organisations that strategically use cultural intelligence to inform the way they move in and out of lots of varied cultures daily experience success. When we begin to see global understanding and skills that way, we more easily see why its well worth making it a priority personally and corporately. That’s something we can bank on!
[Additional description of the research findings cited in this article cited and explained in the upcoming book, The Cultural Intelligence Difference: Master the One Skill You Can’t Do Without in Today’s Global Economy (AMACOM, May 2010 release).]